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Top Three Outsourcing Targets
By John R. Brandt
Manufacturers today are unlikely to be excellent at every function required to profitably meet customer demand. Outsourcing is here to stay— and the 2010 MPI Manufacturing Study identified the top three outsourcing targets for plants:
· Transportation (72% of plants report “all” or “some” of the activity is outsourced)
· Fabrication (61% of plants)
· Information technology (53% of plants)
The activities least likely to be outsourced are:
· Customer service (84% of plants report “none”)
· Purchasing (83% of plants)
· HR management (78% of plants)
Outsourced Activities
|
|
All |
Some |
None |
Combined All or Some |
|
Transportation |
35.9% |
35.7% |
28.4% |
71.6% |
|
Fabrication |
10.6% |
50.2% |
39.2% |
60.9% |
|
IT |
16.8% |
36.5% |
46.7% |
53.3% |
|
Maintenance |
7.8% |
36.3% |
55.9% |
44.1% |
|
Electrical |
13.5% |
24.0% |
62.6% |
37.4% |
|
Assembly |
6.2% |
27.0% |
66.8% |
33.3% |
|
Design and/or R&D |
7.4% |
25.6% |
67.0% |
33.0% |
|
Sales and marketing |
6.9% |
23.3% |
69.8% |
30.2% |
|
HR management |
6.4% |
15.2% |
78.4% |
21.6% |
|
Purchasing |
4.9% |
12.0% |
83.1% |
16.9% |
|
Customer service |
6.4% |
9.2% |
84.4% |
15.6% |
Source: 2010 MPI Manufacturing Study
Should you be outsourcing more — or less?
__________________________________________________________________________________
The 2011 MPI Manufacturing Study, conducted by the Manufacturing Performance Institute (MPI), with partnership support from Thomas International Publishing Co., is now underway. Participants receive a
free 24-page Executive Summary of this year’s findings and six months of free online access to benchmarks from four years of the study ($495 value): You can anonymously complete the study at www.mpimanufacturingstudy.com. Participate by April 20, 2011.
© 2011 The MPI Group
Customer demand is again booming in many markets - and manufacturers are boosting inventories back to pre-recession levels to keep up. Savvy execs at these firms will adopt recognized best practices to guarantee timely deliveries, minimal inventory and maximum cash flow.
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